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Transperfect Global, Inc. v. Motionpoint Corporation

United States District Court, N.D. California

November 13, 2014

TRANSPERFECT GLOBAL, INC.; TRANSPERFECT TRANSLATIONS INTERNATIONAL, INC.; and TRANSLATIONS.COM, INC., Plaintiffs,
v.
MOTIONPOINT CORPORATION, Defendant.

ORDER ON POST-TRIAL MOTIONS (Docket Nos. 439, 440, 444, 445, 486, 489 and 509).

CLAUDIA WILKEN, District Judge.

Plaintiffs and Counterclaim-Defendants TransPerfect Global, Inc.; TransPerfect Translations International, Inc.; and Translations.com, Inc. (collectively, TransPerfect) seek the following relief in their post-trial motions: (1) an order severing TransPerfect's Lakritz patent claims from the remainder of the case; (2) increased and supplemental damages and pre-judgment interest; (3) an amended permanent injunction against MotionPoint; (4) judgment as a matter of law (JMOL) that MotionPoint indirectly infringes its patent; and (5) attorneys' fees. Defendant and Counter-Claimant MotionPoint Corporation opposes all of these motions and cross-moves for JMOL that the asserted claims of TransPerfect's Scanlon patent are invalid and not infringed, that TransPerfect's damages award should be reduced, and that its own patents are valid and infringed. For the reasons set forth below, the Court GRANTS TransPerfect's motion to amend the permanent injunction and its motion for post-verdict royalties and pre-judgment interest; all other motions are DENIED.

BACKGROUND

TransPerfect and MotionPoint are competing language translation firms which brought claims against each other for patent infringement. Prior to trial, the Court granted summary adjudication that MotionPoint did not infringe TransPerfect's Lakritz patents. The Court held a three-week jury trial on the remaining claims in July 2013.

With respect to TransPerfect's infringement claims, the jury returned a verdict finding that MotionPoint's accused product, called the TransMotion system, directly infringed six claims of TransPerfect's Scanlon patent. The jury also found, however, that MotionPoint was not liable for inducing infringement or contributory infringement.

With respect to MotionPoint's infringement claims, the jury found that TransPerfect had not infringed any claims of MotionPoint's three patents-in-suit. In addition, it found that the asserted claims of all three of MotionPoint's patents-in-suit were invalid as obvious, anticipated, and statutorily barred.

The jury awarded TransPerfect total damages of $1, 002, 006. It found and used a reasonable royalty rate of four percent to calculate these damages. Docket No. 415, Verdict Form.

In August and September 2013, the parties filed a series of post-trial, pre-judgment motions. Both parties renewed the motions for JMOL that they had made during trial. In addition, TransPerfect moved for a permanent injunction and to sever, from the claims that went to trial, its Lakritz patent claims, upon which the Court earlier granted summary judgment of non-infringement by MotionPoint. The parties pointed out that they planned to file additional post-trial motions after the Court entered judgment and determined whether to issue a permanent injunction. The Court deferred its decision on the parties' post-trial motions, entered judgment, and issued a permanent injunction, but stayed its injunction pending resolution of the post-trial and post-judgment motions.

DISCUSSION

I. TransPerfect's Post-Trial Motions (Docket Nos. 439, 440, 445, 489, and 509)

A. TransPerfect's Motion to Sever Lakritz Patent Claims (Docket No. 445)

In May 2013, the Court granted summary judgment of non-infringement to MotionPoint on all of TransPerfect's claims based on its Lakritz patents. TransPerfect moves to sever these claims for a separate appeal from the claims that were decided at trial.

Federal Rule of Civil Procedure 21 provides, "On motion or on its own, the court may at any time, on just terms, add or drop a party. The court may also sever any claim against a party." The court may sever the claims against a party in the interest of fairness and judicial economy and to avoid prejudice, delay or expense, and has "broad discretion" in determining when severance is appropriate. Coleman v. Quaker Oats Co., 232 F.3d 1271, 1296-97 (9th Cir. 2000).

TransPerfect seeks severance of its claims of infringement of its Lakritz patents in order to allow for separate appeals of those claims and the claims decided at trial, arguing that doing so would avoid certain possible undesirable future outcomes resulting from the Federal Circuit's decision in Fresenius USA, Inc. v. Baxter International, Inc., 721 F.3d 1330 (Fed. Cir. 2013).

The Court is not persuaded. This case has been adjudicated in full and can be appealed to the Federal Circuit in a single appeal. There is no good reason to divide the case in two and proceed with two separate appeals. Consequently, Plaintiffs' motion to sever Lakritz patent claims is DENIED.

B. Motion for JMOL on Marking Defense or New Trial on Damages (Docket No. 439)

At trial, MotionPoint argued that TransPerfect's damages claim should be limited because neither it nor the predecessor owner of its Scanlon patent had marked the products they produced embodying the patent, and that they were required to do so. As a result, MotionPoint argued, damages could be awarded only from October 13, 2011, the date TransPerfect added claims based on the Scanlon patent to this case.

The jury was instructed that if a patent holder does not sell a tangible product that is capable of being marked, then damages commence on the date that the infringer began infringing an issued patent. If the patent holder does sell a tangible product that is capable of being marked, then damages commence on the date that the alleged infringer has both infringed and been notified of the patent. The jury was further instructed that the patent holder must prove by a preponderance of the evidence the date on which it gave notice and that the matter was for the jury to decide.

As noted above, the jury returned a verdict for TransPerfect of $1, 002, 006, indicating that it had used a four percent royalty rate in calculating that amount. The verdict amount is four per cent of about twenty-five million dollars, which is not a number put forward by either side. TransPerfect speculates that the jury reached this number by finding that TransPerfect's products, and those of its predecessor, had not been marked. TransPerfect argues that such a finding was incorrect as a matter of law.

However, it is not at all clear how the jury reached the damage award. The jury was instructed on lost profits damages and on a reasonable royalty. It was told that if the patent-holder proved its claim for lost profits for only a portion of the infringing sales, then it should be awarded a reasonable royalty for all infringing sales for which it was not awarded lost profits damages. The verdict form called for a total amount of damages, and then for any reasonable royalty rate it used to calculate these damages. This does not necessarily mean that all of the damages were based on that royalty. The jury could have awarded damages consisting in part of lost profits and in part of a four percent royalty on infringing sales for which it did not award lost profits.

Nonetheless, even if the jury did take MotionPoint's marking defense into account, the verdict need not be overturned. There was a dispute of fact as to whether TransPerfect's product could be viewed as a tangible one that could have been marked, on its web pages or on the resulting translations. There was sufficient evidence for the jury to decide the issue and, under proper instructions, it did so.

A motion for judgment as a matter of law after the verdict renews the moving party's prior Rule 50(a) motion for judgment as a matter of law at the close of all the evidence. Fed.R.Civ.P. 50(b). Judgment as a matter of law after the verdict may be granted only when the evidence and its inferences, construed in the light most favorable to the non-moving party, permits only one reasonable conclusion as to the verdict. Josephs v. P. Bell, 443 F.3d 1050, 1062 (9th Cir. 2006). Where there is sufficient conflicting evidence, or where reasonable minds could differ over the verdict, judgment as a matter of law after the verdict is improper. See, e.g., Kern v. Levolor Lorentzen, Inc., 899 F.2d 772, 775 (9th Cir. 1990); Air-Sea Forwarders, Inc. v. Air Asia Co., 880 F.2d 176, 181 (9th Cir. 1989).

TransPerfect's disagreement with the submission of the marking defense to the jury, and the effect its possible finding of failure to mark may have had on its damage award, does not meet this test.

Further, even if the Court were to find that the marking defense should not have been submitted to the jury, or that no reasonable jury could have found as it did, the Court could not simply increase the damage award as TransPerfect suggests. A new trial on damages would have to be held. A new trial should be granted only when the verdict is contrary to the clear weight of the evidence, Molski v. M.J. Cable, Inc., 481 F.3d 724, 729 (9th Cir. 2007), or errors in the jury instructions as a whole misled the jury, see Experience Hendrix LLC v. Hendrixlicensing.com Ltd, 762 F.3d 829, 847 (9th Cir. 2014).

Again, the Court finds that the marking defense was properly submitted to the jury with correct instructions, and that the jury's damage award was supported by the evidence, whether it was based on a finding of failure to mark or not. The Court DENIES TransPerfect's motion on this point and declines to order a new trial.

B. Motion to Amend the Judgment to Award Supplemental Damages, Ongoing Royalties and ...


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